Operations and Project Management Report: IKEA and Portakabin

This report provides a comprehensive analysis of operations and project management, utilizing case studies of IKEA and Portakabin. Part 1 examines IKEA's operations, including its implementation of lean and Six Sigma principles, analysis of its operation management, and a discussion of continuous improvement plans. Part 2 focuses on a Portakabin case study, detailing its business case, project plan, work breakdown structure, and Gantt chart. The report further explores project methodology, tools, leadership, the importance of the Product Life Cycle (PLC), cost-saving techniques, quality assurance, and a critical analysis of relevant theories, concluding with an evaluation of the PLC within a practical and theoretical framework. The report aims to provide insights into effective operations and project management strategies, emphasizing continuous improvement and practical application.

Operations & Project
Management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Introduction of IKEA furniture..............................................................................................3
Concept of operation and its management.............................................................................3
Execution of operation principle in IKEA furniture...............................................................4
Analysis of IKEA operation management. ............................................................................5
Discussion philosophy and describe lean principle................................................................5
Prepare an plan based on review............................................................................................6
Recommendation based on continuous improvement principles...........................................7
PART 2............................................................................................................................................7
Overview of Portakabin case study........................................................................................7
Business case..........................................................................................................................8
Project plan.............................................................................................................................8
Work breakdown structure...................................................................................................10
Gantt chart............................................................................................................................11
..............................................................................................................................................13
..............................................................................................................................................14
Project methodology, tools and leadership required for project ..........................................14
Importance of PLC in execution of success of Portakabin case study.................................16
Techniques of cost saving in incorporated in PLC...............................................................16
Ensure the quality, scope and tenure techniques..................................................................16
Critical analysis of different theories...................................................................................16
Critical evaluation of PLC with practical and theoretical framework..................................17
CONCLUSION..............................................................................................................................17
REFERENCES..............................................................................................................................18

INTRODUCTION
Operation management is a process of coming day to day as well as strategic business
issues in a systematic way. On the other side, Project management is deals with planning,
motivating, organizing and controlling resources in order to achieve specific goals and
objectives. The present report is divided into two parts Part 1 and Part 2. The part 1 is based on
“IKEA Furniture” which is a multinational group. The company designs and sells ready to
assemble furniture, home accessories, kitchen appliances and other utility goods. In, Part 2, case
study based on “Portakabin” is presented, which is portable or transportable building. The report
will review and critique the effectiveness of operation management principle. Study will prepare
by a continuous improvement plan based on operations and its management principles within the
organization. The report will apply each stage of the project life cycle for completing the project.
It will also highlight the effectiveness of Product Life Cycle in application to the chosen project.
PART 1
Introduction of IKEA furniture.
IKEA is multinational group. The group has been world's largest furniture retail company
since 2008. The group designs and sells ready furniture and other home accessories (Allen,
2019). The business is a private company which is owned by inter IKEA system B.V. and is run
by the sons of its founder. The company is known for its modernist and unique design of
products which are often Eco-friendly. Company has a corporate structure, which has members
of the European parliament. In June 2019, there are 424 IKEA stores in 51 countries.
Ingvar Kamprad founded IKEA in 1943 as they take mail order to make sales in the
business. The first store was started in Almhult, in 1958 which is under the name of modern
IKEA. It has achieved high level of success, West German executive of this group accidentally
started a store in another country, after then they decide to open in another part of the world such
as Japan, Hong Kong and so on. The IKEA is the biggest market, in United Kingdom (Estelles-
Miguel and et.al., 2019).
Concept of operation and its management.
Operation is the term describing characteristics of a system from the viewpoint of an
individual who will use the system in the business such as specification of stakeholder
requirements and business requirements (Conger, 2015). This system has provided proper
information to IKEA manager in order to achieve goals and objectives. Operations are plays a

crucial role in organization in order to handles issues which are related to design, operations and
maintenance of system used for production of goods. On the other side, Operation management
is concerned with the planning, controlling, organizing and supervising in the context of
production and manufacturing of goods and services. It is the main business function which is
responsible for managing process of creation of goods and services. This is very important as it
keeps the business fresh and allows for creating new product and services to IKEA's production
manager. It is the vital component of a manufacturing operations and it is so important for
ensuring strong operation management process.
Execution of operation principle in IKEA furniture.
Operation management plays an important role in IKEA group. The operation
management is implemented, with key adjustments which are made to support the IKEA in
attainment of strategic goals in effective manner (Estelles-Miguel and et.al., 2019). The main
aim to IKEA group is to reduce wastage and enhance productivity with low cost. Here is
implemented, the six sigma and Lean principle to better efficiency and effectiveness of products.
Six sigma:
It is the approach that focuses on prime of goods. The six sigma is helpful for IKEA
which is describe steps and financial target by increasing profits or reducing costs. Six sigma
process includes trending charts, potential defect and other ratios. The main aim of this tool is to
improve quality of goods and services at IKEA group (Meredith, Mantel Jr and Shafer, 2017).
For example; if company is use six sigma approach in order to improve quality of goods by using
the best quality of raw material. The main principle of recognize quality of raw material first
then design the product in blueprint. After recognizing and designing manager measure product
it is good or not and analysis of design product which is help to maintain the quality of goods.
Improve is the main principle of six-sigma because this improves quality of goods by control the
products and services.
Lean production:
Lean principle is approach to manage and focuses on cutting out the waste, whilst
ensuring quality. It allows IKEA to discover inefficiencies in their organization and deliver the
best values and products to customers (Fleming and Koppelman, 2016). On the other side it
encourages creation of best flow in work developing continuous improvement culture. For
example: company manufacture various home accessories like furniture by using different type

of raw material. At the time of manufacturing, lots of wastages occur but by using lean principle
company manager is able to eliminate wastages from production. This gives positive impact on
company. On the other side, if company do not use this than they face high cost of purchasing
raw material.
Analysis of IKEA operation management.
The operation management of IKEA is a series of process that are mutualist on each other
and linked with procedures. Operation management, an organization able to heighten key
aspects, that provides services or products as per the needs of customers. IKEA uses self-services
model instead of appointing sales people to attend customers. The lean principle approach is
helping to IKEA manager to reduce wastages from the manufacturing process (Furterer, 2016).
This helps to addition supply chain of organization as it is easy to manage their suppliers as well
as customers.
This help to IKEA manager in order to analyse, market strategy and designs which are
enforced by producing own modified designs on lower prices for attract more customers towards
business. On the other side, IKEA manager focuses on quality management by implementing six
sigma approach. That has provided great chance to increase effectiveness and productivity of
organization. Through this, IKEA is capable of delivering high quality of product at low prices.
Discussion philosophy and describe lean principle.
Uninterrupted improvement in the organization is very important to increase growth of
IKEA. The lean principle approach for management which focuses on reduction of waste and
ensuring quality of goods. Kaizen is the philosophy which includes in Lean principle.
Five key principle of lean: Value Identification is always considered as lean principle constantly review of their
product and services for customer perspective. This also help to satisfy customers needs
by achieving mission and objectives of company. Value stream is involved in taking a product from raw material and delivering on time
(Heldman, 2018). Here is manager determine the values that they provide in their product
to customers. Flow helps IKEA manager in order to eliminate wastages from production. Through that
manager is stopped all wastage from their product process by using best tools with lean
manager.

 Pull out time of market, this simply means the company pull products form market. Here
is lean manager produce product as per customer requirement like cost, space and time
based.
 Perfection in making the process of improvement as part of culture. Finally here is lean
manager identify the area of improvement and implements effective changes in product.
KAIZEN continuous improvement:
This philosophy has promoted continuous gradual improvements and translate as “change
to become good”. This includes the important factors within the lean production system. The
elements of Kaizen such as personal disciple, improved morale, teamwork, quality circles and
suggestions and improvement (Jacobs, Swink and Linderman, 2015). This approach is helping in
creation of continuous and best improvement which is based on an idea which is ongoing
positive changes can reap major improvement.
For example: If IKEA is using the best quality of raw material for manufacturing the best
product and services by using lean principle through Kaizen philosophy. Production is seeking
the involvement of employees, help to identify issues and problems. After, that creation of
solution and test, finally the analysis of result in effective manner. The main advantage of this is
increased customer satisfaction.
Prepare an plan based on review.
Continuous improvement is ongoing activity which have aim to improve company
performance by focusing on additive changes in process (Kerzner, 2017).
Evaluation of Six sigma:
The six sigma is effective in responding to a frustrating quality problem which company
faces. The IKEA had the total quality management program through this, the company is able to
manage quality of goods but face problem related to wastage. The company manager decides to
shift towards process quality and internally developed program for improvement. After this,
company include six sigma programs in manufacturing process in order to cut down wastage
cost. This includes various practice like cross functional team and customer involvement (Six
sigma approach, 2018). Recognize: Here, manager of company is recognize the products which they are produce
and find where required a change. Design: at their, manager design the product sample as per recognizing process.

 Measure: after designing product, it is required to measure product which is appropriate
or not. That helps to attract customers. Analysis: after measuring, manager is analysis of product by getting feedbacks from staff
about products and services. Improve: after recognizing, designing, measuring and analysing product here is required
to improving existing product. Control: controlling is important part where manager is control the wastages in quality
and quantity.
 Standardisation: this is the final stage where final product is produce and ready to sell in
market.
For example: Raw material like the wood go through the various process in order to
create a good design of chair. Process of improvement is taken action for improving IKEA
organizational process like improving chair process of making so that less raw material is
continued, or reducing the cycle time from proposal to delivery of products on time. Finally, the
result is six sigma programs is the best combination of practices for improvement.
Recommendation based on continuous improvement principles.
Company incorporates lean management in IKEA operational management. Some
effective recommendation for company in order to improve manufacturing process (Laureani and
Antony, 2017). The recommendation for lean management involves make focus on long term
results as well as principle to achieve growth of company. Moreover, company have to provide
proper tools and techniques which are beneficial for IKEA in order to increase productivity of
manufacturing.
PART 2
Overview of Portakabin case study
Portakabin is the UK's market leading modular building innovators and are operating in 6
countries both in secondary and tertiary sector as business to business organisation. There are
approx 1,300 employees working in the company and they manufacture as well as hire a modular
buildings (Kerzner, 2017). Its buildings are usually made off-site, transported and constructed on
site. Portakabin have recently launched its latest product YBS that is Yorkon Building System
and this new product is at cutting edge of modular building technology.

Business case
This new product is very important for this business as today's market is more dynamic
due to change in customer’s needs. Customers preferences are changing on daily bases and
business have to except these changes by bringing innovation in their products. Competition
have increased and Portakabin have to offer exceptional products in order to retain their
customers.
Portakabin targets Business to business market that is their target audience for this new
product launch will be small and large businesses of UK and other countries in which company
is operating its business. Basically company is operating its business for both secondary and
tertiary sector.
Cost benefit analysis
Particulars Amount
Benefits Amount
Income from rental $4222.50
Income from sales $225200.00
Income from the sales after rent period $33780.00
Total benefit= $263202.5
Cost Amount
Construction cost $211125.00
Sales and staff cost $12667.50
Financing cost $28150.00
Total cost= $251942.5
Benefit cost ratio 1.04

Project plan
Figure:- 1
Project life cycle is having 4 major steps that represent the path that was followed by the
business in order to take project from initiation to its closure. If business invest in research and
development and design of the new product, it should be aware about the PLC that is associated
with the products (Volkov and Kuzina, 2016).
The stages of project life cycle in relation with Portakabin is as follows: -
 Initiation Phase: - At the initial stage of PLC, objective of the project that is the reason
of development of new product YBS is been identified and also business problem is
identified for which the project is taken forward. For the same study is been conducted by
Portakabin in order to investigate the objectives so that final recommendations can be
brought out with respect to launch of its latest product Yorkon Building System. Here
clear understanding of goals, priorities, deadlines and risk in carrying the project further
is being there so that project can be carried further effectively. As recommendation is
approved by the senior authorities, project is initiated to deliver the appropriate solutions.
Illustration 1: Project life cycle

For taking the project further project manager is being appointed. Project manager play
an important role in building the team and move onto planning phase.
 Planning Phase:- At this stage project solutions are developed by Portakabin's project
manager in detailed manner and plan is made to carry the steps in order to meet the
objective of launch of Yorkon Building System. Resources are identified in order to
develop the YBS and strategy is made to produce the resources. Here outline is created
with respect to activities, tasks and time frame. Project budget is prepared in order to
analyse how much cost will be included for labour and equipment’s in developing YBS
and launching it to market (Volkov and Kuzina, 2016). Here Portakabin's project
manager identify the threats that might cause problem and they work to deal with all sort
of risks. Finally, manager document the quality plan and control measures that are
required to complete the project effectively.
 Execution Phase:- At this stage of PLC project plan is put into motion that is the actual
task in developing YBS are taken forward. Project manager at Portakabin maintain
control and proper communication between the team members. People perform their
tasks and Project manager analyse their performance and progress is then reported on
regular meetings so that members can be directed in right directions. If variation is seen
from actual plan, then manager modify the plan so that YBS is launched without any
issue. Modified plan is updated in team on regular basis and performance is monitored
effectively. Report related to cost, schedule and quality of deliverable is prepared so that
quality can be measured against the acceptance. As Yorkon Building System is been
developed and launched in market with customer satisfaction, project is then ready to be
closed (Kerzner, 2017).
 Closing Phase:- So at the final stage of closing, final deliverable that is YBS is launched
to market and project documents are handed to the company Portakabin so that business
can terminate the suppliers contracts and communicate the stakeholders that project is
been closed. Result is analysed that is what went right and what went wrong during the
project so that business can summarize the key learnings and can utilize the same in
future projects.
Work breakdown structure

Gantt chart